Really old thread resurrection, but I guess still valid.

Smaller tires do help with in-town mileage. The lighter weight and increased ground-line torque means acceleration is much quicker. Therefore people don't press the accelerator as hard.

They can hurt with moderate speed highway mileage because the engine has to turn faster to achieve the same driving speed. So if you're cruising along at 55 on flat terrain then smaller tires will actually hurt mileage.

But under heavier loads due to much higher speeds (wind resistance), climbing steep hills, or pulling heavy loads the numbers with smaller tires go back to positive thanks to the increased torque. This is the reason lots of tractor-trailer rigs have gone to smaller tires.

You also gain a "fake" increase in mileage with smaller tires if you are judging by the on-board computer. The computer thinks you've driven a longer distance than you actually have.


Back to the OP's very old poll, they missed the biggest and most effective "mod"... use a lighter foot on the accelerator.

[EDIT TO ADD]
After reading more in the thread it turns out "smaller tire" was referring to smaller width, not smaller diameter. Slightly less wind resistance, but could be significantly less rolling and inertial resistance. A bigger help would be to avoid AT or MT tires and stick with a highway tire.